The curse of the ‘British Summer’ strikes again

The curse of the ‘British Summer’ strikes again

Home » The curse of the ‘British Summer’ strikes again

In figures released by the ONS for May, the gloomy British weather was cited as a leading reason behind a slowing down of sales.

Post By Craig Bennett -
CEO

After a strong start to the year, ONS is reporting a 0.5% decrease when compared to last month in quantity bought with a notable decline of 4.5% in clothing sales. Sentiment from the industry points to the poor weather in May causing a delay to summer promotions, which has in turn impacted consumer’s appetite for spending in this area. This strong decline in clothing sales follows relatively high levels of growth in recent months. Year-on-year growth is minimal at 0.3% and is a considerable slowdown to the strong growth in March at 7.2% and April at 9.2%

Looking more broadly however, in the three months to May overall retail sales have continued with steady growth of 1.6% despite the impact of the clothing sector. Household goods sales also stand out as lacking growth with consumers perhaps waiting for the summer sales before investing in pricey household items.

Online continues its impressive surge as a channel of choice for consumers who appreciate its many benefits, from researching across a range of suppliers/products to the ease of 24/7 access and next day home delivery. Current stats put online accounting for 19.3% of all sales, showing an impressive 8.2% growth since May 2018.

Looking across the first five months of the year, we’re seeing better than expected levels of consumer confidence, likely buoyed by low unemployment rates and with earnings continuing to expand at a healthy rate.

However, this continues to be a tale of two halves as retailers themselves continue to struggle against difficult market conditions and demanding customer expectations. I mentioned the Arcadia Group last month; their restructuring proposal has only just got through on its second attempt and relies heavily on landlords committing to rent reductions and the same has recently hit the news for the Monsoon Group. Whilst retailers must continue to adapt to evolving customer requirements, so too must the overall proposition for bricks and mortar stores to ensure that the high street continues to thrive. Business rates and rents are two of the highest commitments for retailers and so must be considered as key factors when looking at how to ensure that physical stores continue to be part of a brands growth proposition alongside online and other channels.

Overall, the outlook for Q2 much like the British weather, is gloomy, with perhaps stormy times ahead.

 

ONS Report for April


ONS retail data for the month of April released on Friday (24th May) shows a mixed view of spending, with some clear winners and losers across the key retail areas but overall, it confirms a long-term trend of growth.

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